Friend-shoring critical mineral supply chains

Critical minerals go beyond “rare earths”, constituting the key ingredients in a wide variety of high-end technologies that have become omnipresent in modern-day societies. The significance of these minerals has expanded in scope as nations work toward their green transition.

Over the last 20 years, China has become the leader in mining most and processing all major critical minerals. Given its rapid technological advancements and transition to clean energy sources, China’s demand for critical minerals soared. As a result, the Middle Kingdom exerts significant control over both upstream and downstream markets. In the long run, this dominance could impact innovation and impede global climate response.

In this study, Akhil Ramesh and Rob York of Pacific Forum map the supply chains of critical minerals, showing how China assumed a central role in harvesting and distributing them, and offer suggestions on how to diversify the industry. From the availability of critical minerals to the industrial capacity for processing in each economy, the authors conclude that Canada, Australia, and Chile present the most viable alternatives to re-shoring supply chains away from China in the Indo-Pacific region.